12/6/2021 Financial News In China: CSRC Says Promoting Delisting Of U.S.-listed Chinese Companies Is a Misunderstanding; Communist China To Create New State-owned Rare Earth Giant

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1. CSRC: Promoting Delisting of U.S.-listed Chinese Companies is a Misunderstanding and Misinterpretation

(Reuters) The announcement by Didi to launch its delisting from the United States has sparked market concerns about the prospects of Chinese stocks. The China Securities Regulatory Commission (CSRC) responded on Sunday, saying it is always open to companies choosing where to list abroad and fully respects their independent choice of listing places in accordance with the law. The spokesperson responded some overseas media reports that Chinese regulators will ban overseas listing of companies with VIE structure and demand Chinese companies to delist from U.S. stock exchanges as “complete misunderstanding and misinterpretation.” The U.S. Securities and Exchange Commission said last Thursday that Chinese companies listed on U.S. stock exchanges must disclose whether they are owned or controlled by CCP entities and provide evidence of audit.

2.Communist China to Create New State-owned Rare Earth Giant

Communist China has approved the creation of one of the world’s largest rare earth companies, people familiar with the matter said. The move by Communist China aims to maintain its dominant position in the global supply chain for the strategic metal at a time of heightened tensions with the United States. The new company, which will be named China Rare Earth Group, will be set up as soon as this month in the resource-rich Jiangxi province in southern China, the people familiar with the matter said. The new entity will be created by merging the rare earth assets of several state-owned companies, including China Minmetals Corp, Aluminum Corp. of China Ltd, and Ganzhou Rare Earth Group Co.

3. The Second Batch of Large Wind Power and Photovoltaic Base Projects Start to Declare

On December 6, China Securities Journal reporter learned from authoritative sources, the National Energy Board recently issued a “notice on the organization to be included in the second batch of national large wind power photovoltaic base projects focused on the desert, Gobi, and desert areas”. The Notice requires the provincial energy authorities to submit the second batch of project list by December 15. The notice proposes that the implementation of the project owner, land, environmental assessment, grid consumption and other conditions, has been approved (for the record) and can start construction in 2022, in principle, can be completed in 2023 and connected to the grid, part of the project subject to external conditions should be able to be completed in 2024 and connected to the grid.

4. The Futures Act Expected to be Officially Released in 2022

On December 5, Fang Xinghai, Vice Chairman of CSRC, said at the 17th China (Shenzhen) International Futures Conference that the futures market maintained a good development trend in 2021. The market size and volume continue to grow, and the market construction continues to deepen. The total capital of the domestic futures market has now exceeded RMB 1.2 trillion, up 44.5% from year-end 2020. Meanwhile, Fang Xinghai revealed that the Futures and Derivatives Law is expected to be formally released in 2022 after the third review.

5. Communist China Logistics Group Established Today

On December 6th, Communist China Logistics Group was officially established. The newly formed Logistics Group is based on the integration of the former China Railway Materials Group Ltd and four enterprises in the logistics sector of China Chengtong Holdings Group Ltd (Chengtong), namely China Materials Storage and Transportation Group Ltd, China International Logistics Corporation Ltd, China Logistics Corporation Ltd and China Packaging Company Ltd. The shareholding structure is as follows: the State-owned Assets Supervision and Administration Commission of the State Council (SASAC) and Chengtong each hold 38.9%. The other three strategic investors hold 10%, 7.3% and 4.9% of the shares respectively.

6. Merger Plan of Two Tour Giants Terminated

On the evening of Dec. 5, Caissa Tosun and UTour Group announced separately that they had decided to terminate the planned merger of Caissa Tosun and UTour Group by agreement of both parties to the transaction. In June this year, the two companies issued a restructuring plan, Caissa Tosun intended to issue A shares to all shareholders of UTour Group and intended to raise matching funds from no more than 35 specific investors by way of inquiry, which is expected to be no more than RMB 1.7 billion. The news aroused attention because the transaction amount exceeded RMB 6.2 billion and both parties were leading companies in the domestic tourism industry. However, the restructuring plan was opposed by HNA Travel Group, the second largest shareholder of Caissa Tosun. After that, the Shenzhen Stock Exchange issued a restructuring inquiry letter, asking for a specific explanation of the matters involved in the transaction plan.

7. SenseTime to Launch Hong Kong IPO

(Reuters) Chinese artificial intelligence (AI) startup SenseTime is looking to raise up to $767 million in a Hong Kong initial public offering (IPO). The company’s IPO, launched Monday, will offer 1.5 billion shares at a price of HK$3.85 to HK$3.99 per share. Eight cornerstone investors have signed on for the IPO and subscribed $450 million or 58.6 % of the total offering size ahead of the IPO. The company’s shares will be priced on Friday and start trading on the Hong Kong Stock Exchange on Dec. 17. The company plans to use most of the funds raised from the IPO for research and development of its key AI technologies. SenseTime offers technology-based applications including facial recognition, video analytics and autonomous driving. It was one of eight Chinese technology companies blacklisted in the U.S. in 2019.

8. Allianz China Fund Significantly Reduces Holdings in CATL

Recently, Allianz China A-Shares Fund, the largest overseas fund aims to China A-Shares markets, announced its latest position. In October, Allianz China A-shares Fund reduced its holdings of the top 10 stocks. Among them, the reduction of Contemporary Amperex Technology (CATL) reached 18.58%. The data shows that Allianz China A-shares Fund reduced its position in June, July and August for three consecutive months, and then re-increased its position in September. Entering October, the fund reduced its position in CATL again. As of Dec. 3, the fund was about RMB 77.827 billion in size, making it the largest overseas fund targeting Chinese stocks.

【G Translators- Financial Team】
Author: Rosy Cloud

Disclaimer: This article only represents the author’s view. Gnews is not responsible for any legal risks.

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